Fewer companies in Singapore settled their payments on time in the second quarter of 2014, according to a study released by Dun & Bradstreet (D&B) Singapore, which cited slower economic growth as a contributing factor.
The business information group, which monitors more than 1.5m transactions by companies through the Singapore Commercial Credit Bureau (SCCB), reported that only 47.38% of payments were made on time between April and June, down from 51.92% in Q114.
However, compared with a year ago, payment promptness improved slightly, from 46.77% to 47.38%.
The proportion of slow payments rose from 37.88% in Q114 to 41.1% in Q2. Partial payments also rose from 10.2% to 11.52%, the study found.
All five industries monitored in the study – construction, manufacturing, retail, services and wholesale – experienced an increase in payment delays during the quarter.
The construction sector saw the highest number of slow payments, with payment delays rising from 47.66% in Q1 to 51.44% in Q2. Based on SCCB data, the study reports that payment delays within the construction sector last crossed the 50% mark in Q212.
The services sector experienced the sharpest increase in payment delays, rising from 40.06% in Q1 to 43.85% in Q2. Health services, hotels and accommodation services and business services accounted for the largest increases in payment delays; registering 51.08%, 46.67% and 44.10% respectively.
Audrey Chia, chief executive officer (CEO) of D&B Singapore, said: “The downward trend in payment performance clearly reflects how slower economic growth last quarter has impacted the ability of firms in meeting their debt obligations.”
However, she noted that the rising proportion of partial payments suggest that firms are placing a greater emphasis on remaining creditworthy to their creditors.
“As global uncertainties continue to prevail, firms will have to exercise greater flexibility in adapting their cashflows and credit management policies according to volatilities of the macroeconomic environment. Partial payments may the most viable option for cash-strapped firms.”
On day one of SIBOS, panellists unanimously agreed that doing nothing to modernise payments was no longer safe bet for transaction banking.
On day one of Sibos 2017, Stefan Dab, The Boston Consulting Group led a conversation examining the future of correspondent banking, and specifically the pain points corporate treasurers face in their cross-border payments operations and where technology can be developed to alleviate these.
Rising interest rates, excitement around blockchain use cases and cross-border payments were all hot topics at this year's AFP conference in San Deigo.
The US dollar and debt yields falling on the North Korea missile test, treasury being a top target for cyber criminals and why treasurers aren't into real-time payments all hit the latest headlines in the world of treasury this week. Don't miss our ten top news stories from around the world.